ARCHIVE: 5 MINUTES WITH . . .

Representing Canada’s Interests in Washington

Michael Wilson, Canadian Ambassador to the United States

August 17, 2009

Michael Wilson is The Conference Board of Canada’s 2009 Honorary Associate. The Conference Board’s highest honour, the award is given annually to individuals who have served their organization and country with great distinction during an outstanding career. The award will be presented November 5, 2009 in Toronto.

Michael Wilson assumed his responsibilities as Ambassador on March 13, 2006, becoming the 22nd representative of Canada to the United States. Prior to taking up his current position in Washington, Ambassador Wilson was Chairman of UBS Canada.

In 1979, Ambassador Wilson was elected to the House of Commons. In September 1984, he was appointed Minister of Finance and held that post until 1991 when he became Minister of Industry, Science and Technology and Minister for International Trade. Prior to his career in public life, Ambassador Wilson had a career in investment banking.

An Officer of the Order of Canada, Ambassador Wilson is active in a number of professional and community organizations including the NeuroScience Canada Partnership, The Centre for Addiction and Mental Health, The Canadian Council for Public-Private Partnerships, and the Canadian Coalition for Good Governance.

InsideEdge: What is one thing that Canadians should know about President Obama that may come as a surprise?

Michael Wilson: This is a man with a wonderful engaging smile, and you think he is a very nice guy to do business with. Well, he is a nice guy to do business with, but he’s also very tough, strong, and disciplined. He’s very bright, and he’s got a sense of where he is going himself and where he is taking the country. He’s determined to do what he sets out to do, and if you’re going to go against him, you had better be ready for a tough fight. He is someone who sees a lot of issues in a very broad context. The individual issues that he is working on have to be viewed against the strategic direction that he wants to follow.

This recession is a tough one. It’s certainly deep and it looks like it’s going to be enduring.

InsideEdge: What are the most pressing issues on the agenda of Canada–U.S. relations?

Michael Wilson: Clearly, the most pressing issue is the health of the economy. This recession is a tough one. It’s certainly deep and it looks like it’s going to be enduring. People talk about the green shoots, but we still have a way to go before those green shoots blossom into a full-grown flower.

Specific Canada–U.S. issues include management of the border, border security, and trade. On the international side, Afghanistan is very much the top priority for both of our countries. But another international issue that has engaged our countries is policies on the Americas—on the Honduras question, and on the question of re-engaging Cuba, trying to get it more engaged with the broader international community.

InsideEdge: How should Canada deal with trade provisions such as “Buy American” policies to strengthen trade with the United States?

Michael Wilson: We are concerned because the provinces—and most prominently the municipalities—have said, “Let’s take reciprocal action against them. If they‘re going to restrict our access to their global procurement or their government procurement market, maybe we should do the same.” That’s not the way to go. Trade protection is never a positive thing.

We are trying to work with the Administration and Congress to change the policy. One way would be to apply the federal government procurement rules to the states and the municipalities. After all, this is federal money that they’re spending. In parallel, the second track we’ve been talking about with the provinces is to enter into an agreement of some sort with the United States to secure mutual access to sub-federal procurement markets—such an agreement would have more force and impact. It’s a two-track approach: the second is complementary to the first.

InsideEdge: Replacing the manufacturer’s sales tax with the GST has been seen as one of your greatest public policy legacies. Why did you see it as an essential policy change? Almost two decades later, has the history of the GST unfolded as you expected or intended?

Michael Wilson: I think it has been even more positive than I had anticipated. The GST was not brought in as a new tax, isolated from the rest of the tax system. It was implemented to replace a manufacturing sales tax that was damaging a very important sector of our economy: the manufacturing industry.

Why did we see it as an essential policy change? You have to go back to the 1980s when the Mulroney government set out a broad policy to improve the competitiveness of the Canadian economy. We had the free trade agreement with the United States, followed by the North American Free Trade Agreement. The GST allowed manufacturing companies to reduce the price for their goods in the export market—it improved their competitiveness. This helped us in taking full advantage of the free trade agreement. The GST was very much a central part of the overall policy of improving the productivity of the Canadian economy.

InsideEdge: In 2004, you stated that you would have placed mental health on the nation’s economic agenda—had you known its effects when you were finance minister. You have also challenged businesses to make it part of their agenda. Have Canadian employers and health-care providers made satisfactory progress in raising awareness of mental health in recent years?

Michael Wilson: Mental health is important in an economic sense, as well as very much in a humanitarian and medical sense. If you are suffering from mental illness and you’re coming to work carrying that burden, or if your employer is not sufficiently aware and sensitive to the damage that mental illness can do to an individual, you’re not going to be able to do as good a job as you would if you were treated properly.

I think a lot has happened since I made the comment. There’s certainly a greater awareness of mental illness, and senior management is taking actions that percolate down. Organizations are helping people who have mental illness deal with the illness and also address their recovery.

We have a number of good examples. Canada Post is working with its union in identifying specific working conditions and reducing the stress that can lead to more serious mental illness. Great-West Life is looking at mental illness, both as an employer and also as an organization that has a very important presence in the disability insurance arena. The Canadian Life and Health Insurance Industry Association has published guidelines on managing mental health in the workplace. Most, if not all, of the banks have developed management practices to deal with the incidents of mental illness in the workplace, such as early detection and support, and working with the person to deal with some of the pressures they have.

Organizations are helping people who have mental illness deal with the illness and also address their recovery.

InsideEdge: You served as Chair of The Canadian Council for Public-Private Partnerships. Conference Board research indicates that public-private partnerships (PPPs) can be an efficient way of delivering public infrastructure. Do you think there should be a greater role for PPPs in the massive infrastructure stimulus spending that has been undertaken by governments in both Canada and the United States?

Michael Wilson: I definitely see PPPs playing an important role. A public-private partnership doesn’t work for all types of infrastructure, but it does for a number of areas where you can draw in the private sector expertise, experience, and technical know-how and use that to bring in the project at a lower cost, faster, and usually on more economic terms. Our job at the Canadian Council was to encourage governments to ask the question, “Is this an appropriate vehicle or an appropriate project for a vehicle like a public-private partnership?”

I think it is particularly important today because both in the United States and Canada, governments at all levels—federal, provincial or state, or municipal—are facing significant financial squeezes. It’s probably as appropriate a time as we’ve seen in a long time for cash-strapped governments to look to an alternative approach to financing and building their infrastructure projects.

InsideEdge: You have spoken at a number of Conference Board conferences and attended the Board’s events. What does it mean to you to be receiving the Conference Board’s 2009 Honorary Associate Award?

Michael Wilson: It’s a great honour. The Conference Board is a highly respected, highly regarded organization. To be recognized by the Board to receive the Honorary Associate Award is really terrific and I’m delighted that I have been selected. I know I’m in very good company with the people who have received this award in the past.

I have gone to a number of conferences, and I’ve always gained a lot from listening to the presentations made by Conference Board staff or the interaction among the attendees. The Conference Board is one of the best conveners for business conferences and so I’m always delighted to be able to accept an invitation to join them. I always learn something, and I also meet some very interesting people.